Tesla Falls Short of Q3 Earnings. Here's the Analyst Reaction

Tesla’s third-quarter results fell short of Wall Street’s expectations, leaving analysts divided over what lies ahead for the electric vehicle pioneer. Shares of Tesla dropped 3% after the company reported adjusted earnings of 50 cents per share, missing the 54 cents analysts surveyed by LSEG had projected.

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On a brighter note, revenue reached $28.1 billion, surpassing the $26.37 billion forecast. Automotive sales also climbed 6% year over year, rising to $21.2 billion from $20 billion a year earlier.

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Part of that growth was fueled by customers accelerating purchases to take advantage of federal tax credits before they expired. Analysts now wonder how Tesla’s demand will hold up in the coming quarters as those incentives fade and tariff costs rise. Many are also closely watching the company’s efforts to scale its ambitious Robotaxi project.

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Despite the challenges, long-time Tesla bull Adam Jonas of Morgan Stanley remains optimistic. He described Tesla as “navigating a dignified exit from the steering-wheel-having auto business while maintaining a resilient free cash flow profile.”

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Here’s how leading Wall Street firms reacted to Tesla’s earnings report.

Wells Fargo: Underweight, $120 price target
Wells Fargo’s Colin Langan remains bearish, setting a target that implies roughly 73% downside from recent levels.
“Tesla made a range of promises for 2026 including robots, semi-truck production ramps, and fully autonomous cybercabs but the core business continues to weaken,” Langan wrote. “Robotaxi and Optimus are likely to take longer to scale than expected.”

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UBS: Sell, $247 price target
UBS kept a cautious stance, with a price target about 44% below Tesla’s prior close.
The firm said Tesla is deliberately keeping its short-term guidance vague as it transitions “from an EV manufacturer to an AI-driven company.” UBS expects Elon Musk to continue emphasizing future opportunities particularly heading into the November 6 shareholder meeting but warned that Tesla’s current market cap already prices in nearly $900 billion of value from its AI ventures.

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Jefferies: Hold, $300 price target
Jefferies maintained a Hold rating, noting downside potential of about 32%.
The analysts cited a modest earnings and margin miss due to $238 million in one-time charges, but highlighted a solid $4 billion free cash flow supported by a $2.1 billion working-capital inflow. “The auto division may no longer be the key driver of valuation,” they said, “but it still generates enough cash to fund Tesla’s future innovations.”

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Barclays: Equal Weight, $350 price target
Barclays struck a neutral tone, setting a target that implies a 20% decline from recent levels. “Tesla missed on third-quarter EPS, but that’s not the story,” the analysts said. “The focus is shifting away from cars toward AI initiatives including robotics and autonomous driving which represent Tesla’s next growth chapter.”

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Goldman Sachs: Neutral, $400 price target
Goldman Sachs analyst Mark Delaney reaffirmed a Neutral rating, with a target about 9% below Tesla’s last close.
Delaney expects long-term profit growth to come from autonomy and robotics but cautioned that Goldman’s base-case outlook is “more measured” than Tesla’s own ambitious targets due to competition and uncertain market timing.

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Morgan Stanley: Overweight, $410 price target
Morgan Stanley’s Adam Jonas remains one of Tesla’s most vocal supporters, maintaining an Overweight rating with a target roughly 7% below the recent closing price.
He noted that Tesla’s margins held steady and that $4 billion in free cash flow tripled consensus expectations. “Tesla is gracefully transitioning out of the traditional auto business,” Jonas said, “and the company’s future hinges on Elon Musk’s ability to lead the charge in autonomy amid rising competition.”

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Deutsche Bank: Buy, $440 price target
Deutsche Bank lifted its target from $435 to $440, suggesting limited upside from current levels but reaffirming its Buy rating.
“Following third-quarter results, we’ve made only minor adjustments to our model,” analysts said. “Elon Musk remains deeply involved, and the approval of his compensation plan will help ensure continuity. While progress in Robotaxi and Optimus is slower than hoped, the upcoming v14 software update could mark a key turning point in full self-driving technology. Tesla may ultimately stand as the only Western company capable of building humanoid robots at scale.”

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